Christian Lamarco’s small firm questioned the world’s most valuable company in May
Six months before Nvidia fell into a crisis involving national security, the president of the United States and allegations of modern espionage, a 31-year-old short seller published a 40-page case against the company that almost no one read.
Culper Research, the firm founded by Christian Lamarco, released its report in May, questioning Nvidia’s business in China and what Lamarco called an “uncomfortably close” relationship between Chief Executive Jensen Huang and Alice Huang, an executive at one of Nvidia’s major business partners in Southeast Asia. “This is not a bet against AI,” Culper wrote in the report, which summarized the firm’s short position. “We are short Nvidia for one reason: the company has a significant China problem.”
At first, nobody paid much attention. The day the report appeared, Jensen Huang touched down in Beijing aboard Air Force One on a state trip with President Trump; the next day, Nvidia’s stock hit a record high. Nvidia, which had become the most valuable company in the world by making the chips that power the global AI economy, was worth more than ever as recently as last month. This week, revelations that the company’s chief executive was having an extramarital affair with a woman now suspected of working for Chinese intelligence services turned Culper’s research into a rare piece of securities analysis to go viral.
Nvidia has lost more than $1 trillion in market value since the report was published, and its stock is down 20%. It is unclear whether the trade has made Lamarco money: he declined to say how much he has earned from it, or whether he is still shorting the company.
“Sometimes, people care about what you have to say. Sometimes, they don’t,” Lamarco said in an interview. “I guess in this case, they cared six months later.” “I’ve never quite had anything like this,” he said. As interest surged, he muted notifications on X, where his Nvidia posts have drawn millions of views, and turned down television interview requests.
Lamarco grew up in upstate New York and discovered investing as a finance major at Grove City College, a small Christian school in Pennsylvania. He drove to Carnegie Mellon for a stock-picking contest against Ivy Leaguers, saying his goal at the time was to “prove that Grove City students can compete with students from the best schools in the country.” He and a teammate went long on Nexstar Media Group and won second place — and a $100 prize.
Finance recruiters did not visit Grove City, so Lamarco emailed his own research to hedge funds and landed a job at a long-short firm in Chicago, where he worked from 2017 to 2019. He moved to Pittsburgh with a few months of savings and struck out on his own. When the firm needed a name, he remembered “Turn: Washington’s Spies,” an AMC show he first watched in a high-school friend’s basement, and the Culper ring it depicted — the spies who secretly tracked the movements of British forces for George Washington during the Revolutionary War almost 250 years ago. “Similarly,” he wrote, “we take an exhaustive, investigative approach to investment research.” He later moved to New York and worked out of a Brooklyn apartment while his Shiba Inu begged for treats.
Like other short sellers, Culper says its team works to expose deception and financial irregularities — and, of course, to make a profit. The firm has targeted dozens of public companies since its founding, most of them small-cap stocks, though Lamarco and his two analysts have taken on powerful forces before. Last year, a window and glass manufacturer hired Elon Musk’s attorney and sued Lamarco for defamation after he alleged the company had links to the Sinaloa drug cartel. He also tried to place a $1 million wager with Jimmy Fallon, offering to pay the late-night host if he flew in electric air taxis made by Archer Aviation, a company whose chief executive had appeared on “The Tonight Show” and one that Culper was betting against. Fallon never responded.
The Nvidia report was months in the making. Reporting last year by The New York Times and Bloomberg News drew Lamarco in, and he began digging with his two analysts before setting the work aside because it did not seem worth the time. “It’s just highly unlikely that you’re going to find something that everyone else has missed,” he said. “Are we really going to have anything to say about the largest company in the world?”
In March, when federal prosecutors charged Super Micro Computer officials with smuggling Nvidia chips into China in violation of U.S. export controls, he picked the investigation back up. “Let’s dig a little bit deeper,” he said. Using a network of paid experts, the team interviewed former Nvidia employees, who speculated about a “special relationship” between Jensen Huang and Alice Huang. The analysts examined scrubbed code and corporate filings in Singapore and Malaysia, and pored over YouTube footage from outside a Taiwanese noodle shop.
By May, it was time to publish. After a sleepless night, a bagel and a morning cigarette, Lamarco released the report, confident in the research and unsure what the market would make of it. “When it’s some $500 million pump-and-dump, you can have a sense of what might happen next,” he said. “I just have no idea here.”
For months, not much happened. The stock went down, up, down and up again. This month, as the company fell into crisis, the firm named after a spy ring was already gathering intelligence on its next target. “There’s something relatively big,” Lamarco said. “But by its very nature, nothing will be as big as this.”